Suspended attorney facing theft charges in Delaware, Franklin, Lawrence counties

A suspended Indiana lawyer accused of stealing hundreds of thousands of dollars from disabled and special needs clients was arrested and held without bond in the Johnson County Jail earlier this month after authorities in at least two counties issued warrants for his arrest.
 

Service

Kenneth Shane Service of Greenwood was arrested Oct. 1 and is likely to remain behind bars in Franklin or in one of the three counties where he is awaiting court dates on felony theft charges. Service is accused stealing from several special needs trusts he established and oversaw for vulnerable clients whose money was meant to provide for their long-term medical care and needs.

An Indiana State Police investigator warned in September 2017 of the possibility of “numerous victims in multiple states” from whom Service is believed to have stolen. After allegations against Service came to light, attorneys around the state pre-emptively rushed to remove him as a trustee or administrator in numerous special needs trust cases. Service was indefinitely suspended from the practice of law last October after the first criminal charges were filed against him.

Last month, new charges were filed against Service, 45, in Franklin County. Service appeared Oct. 12 for an initial hearing at the courthouse in southeastern Indiana. Service was charged Sept. 18 with Level 5 felony theft and two counts of Level 6 felony theft for allegedly stealing a total of $102,564.27 from a Brookville man who was the subject of a guardianship. The man’s guardian, his brother, knew nothing of the missing funds, investigating state police said.

Troopers investigated a tip about potentially missing money from the current trust administrator, who questioned three withdrawals between August and November 2016, when Service oversaw the trust. The largest withdrawal — $71,137.83 — was used to replenish money in another trust from which Service is accused of stealing, the charging information says.

In addition to the $71,137.83 withdrawal, an investigating trooper said Service, questioned at his Greenwood apartment in August, told him he knew nothing about a cashier check for $25,652 made out to him from the same Brookville victim’s trust, and he had no answer about a $5,775 cash withdrawal from the victim’s account.

The administrator of the trust Service is accused of replenishing with funds allegedly stolen from the Brookville victim told police she was unaware that the money came from another special needs trust account, rather than from Service.

Franklin Circuit Judge Clay Kellerman issued a warrant for Service’s arrest the same day prosecutors filed charges. Two days later, on Sept. 20, another warrant was issued for Service’s arrest by Delaware Circuit Judge Marianne Vorhees. Court records show Service, representing himself, failed to show up at a pretrial conference the judge had ordered him to attend in Muncie, prompting the warrant.

Service was charged in Delaware County with Class D felony theft in June. He is accused of stealing $23,622 from a former client between April 2014 and June 2016. The alleged victim had been the subject of a guardianship established in 2003 when she was a minor. Online court records show Service was removed as trustee of the guardianship in December 2016.

Service also is representing himself in the criminal case that was filed against him in Lawrence County. There, he was charged in December 2016 with Level 5 felony theft for allegedly stealing more than $85,000 from two clients in Bedford.

Service allegedly used money he took from the Lawrence County trusts to pay for a stay and room service at the Blue Chip Casino in Michigan City, and to pay for at least 35 nights at an Indianapolis Marriott hotel from March 1-April 10.

An Oct. 29 jury trial on Service’s Delaware County charges was recently cancelled and a pretrial conference was set for Nov. 19. A jury trial on the Lawrence County charges is scheduled to begin Nov. 27. Kellerman on Oct. 12 set Service’s trial on the Franklin County charges for Feb. 13, 2019.

In addition to the criminal cases against Service, he figured prominently in a major damages award earlier this year against the charity he founded and was fired from in 2014, the Carmel-based National Foundation for Special Needs Integrity. Special Needs Integrity was ordered by the 7th Circuit Court of Appeals in February to repay the estate of a woman more than $234,000 that the organization took from her trust account after she died in 2011, leaving her heirs nothing.

In that case, National Foundation for Special Needs Integrity, Inc. v. Devon Reese, as Personal Representative for the Estate of Theresa A. Givens, 17-1817, Circuit Judge David Hamilton wrote, “… (W)e must note that the Foundation’s (former) counsel, (Kenneth) Shane Service, testified that he intentionally drafted (a section of Special Needs Integrity’s agreement dealing with distributions upon the death of a beneficiary) to confuse Missouri government officials.”•